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Adam Smith On Method: Newtonianism, History, Institutions, And The “Invisible Hand”




Smith was influenced by Newton’s method. Nonetheless, he introduced elements that led him far from the Newtonian perspective. The present essay analyzes how historical dimensions, contingencies, institutions, and conflicting human inclinations modify a Newtonian horizon. Finally, the paper focuses on how, in Smith’s view, institutions determine “unintended outcomes,” which are sometimes opposed to those of the market. In this sense, the “invisible hand” is not only the result of the behavior of myopic individuals trying to improve their conditions; it is also the outcome of the work of institutions that operate as structures autonomous with respect to individuals.

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  • Fiori, Stefano, 2012. "Adam Smith On Method: Newtonianism, History, Institutions, And The “Invisible Hand”," Journal of the History of Economic Thought, Cambridge University Press, vol. 34(03), pages 411-435, September.
  • Handle: RePEc:cup:jhisec:v:34:y:2012:i:03:p:411-435_00

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    References listed on IDEAS

    1. Fox, Karl A, 1989. "Agricultural Economists in the Econometric Revolution: Institutional Background, Literature and Leading Figures," Oxford Economic Papers, Oxford University Press, vol. 41(1), pages 53-70, January.
    2. Malcolm Rutherford, 2003. "On the Economic Frontier: Walton Hamilton, Institutional Economics, and Education," History of Political Economy, Duke University Press, vol. 35(4), pages 611-653, Winter.
    3. H. Spencer Banzhaf, 2006. "The Other Economics Department: Demand and Value Theory in Early Agricultural Economics," History of Political Economy, Duke University Press, vol. 38(5), pages 9-31, Supplemen.
    4. Rutherford, Malcolm & Desroches, C. Tyler, 2008. "The Institutionalist Reaction To Keynesian Economics," Journal of the History of Economic Thought, Cambridge University Press, vol. 30(01), pages 29-48, March.
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    Cited by:

    1. Madarász, Aladár, 2014. "A láthatatlan kéz - szemelvények egy metafora történetéből
      [The invisible hand - extracts from the history of a metaphor]
      ," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(7), pages 801-844.

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